Assumption
agreement.
1. The undersigned is a Limited Partner in _________
Company of _________, an _________ limited partnership (the
"Partnership"), pursuant to the Partnership's Amended and Restated
Limited Partnership Agreement and its Certificate of Limited Partnership, as
amended (collectively, the "Partnership Agreement").
2. The Partnership will construct a _________
production facility in _________, _________(the "Plant").
Construction of the plant will be funded in part from the proceeds of a
construction loan and term loan (the "Loan") to be made to the
Partnership by a group of banks (the "Lenders"), for which The
_________ National Bank of _________ is acting as agent (the "Agent
Lender"), in the amount of _________ based upon a guarantee to be awarded
by the [United States Department of Energy] (the "DOE") pursuant to
which repayment of 90% of the principal and interest due on the Loan will be
guaranteed by the [United States Government] (the "Guarantee").
The Loan will be divided into a 100% guaranteed
portion in the amount of $_____(the "Guaranteed Loan") and a
nonguaranteed portion in the amount of $_____(the "Nonguaranteed
Loan"). The loan agreements pursuant to which the Loan is being made
(collectively the "Loan Agreements") will provide for a revolving
credit loan until the earlier of _________, 19__ or one year after the Plant
commences operation, during which period interest only will be payable. Upon
the final maturity of the revolving credit Loan, the Partnership will have the
option of converting it into a term loan requiring regular quarterly payments
of principal until final maturity on December 31, 19__. Interest will be
payable on 99% of the Loan at an annual rate ranging from _____% to _____% over
the Agent Lender's prime lending rate. The remainder of the Loan will bear
interest at an annual rate ranging from _____% to _____% over the Agent
Lender's prime lending rate. The Partnership will have the option of choosing
alternative floating interest rates based on the _________.
This Agreement and the corresponding Agreements (the
"Other Agreements"), of the other limited partners of the Partnership
(the "Limited Partners") are being executed and delivered to the
Agent Lender and the DOE as security for the repayment of the Loan. The
undersigned acknowledges that the Lenders and the DOE are relying on this
Agreement and the Other Agreements to provide security for the repayment of the
Loan and that the Lenders would not be willing to make the Loan, and the DOE would
not be willing to issue the Guarantee, but for the execution and delivery by
the undersigned and the other Limited Partners of this Agreement and the Other
Agreements. The Guaranteed Loan is being secured by a first security interest
in this Agreement and the Other Agreements, and the Nonguaranteed Loan is being
secured by a second security interest in this Agreement and the Other
Agreements. In addition to the security interests, the Guaranteed Loan will be
secured by a first mortgage on the Plant, a first lien on the other fixed
assets, contracts and certain other personal property of the Partnership and a
second lien in certain cash pledge accounts and a bank letter of credit being
furnished by _________ Energy Corporation of _________, the general partner of
the Partnership (the "General Partner"), and the Nonguaranteed Loan
will be secured by a second mortgage on the Plant and other property and a
first lien in the cash pledge accounts and letter of credit referred to above.
3. To induce the Lenders to make the Loan, the
undersigned assumes payment of $_____ of the principal of the Loan for each
$5,000 of limited partnership interests in the Partnership
("Interests") purchased by the undersigned. The undersigned agrees
and promises to pay that amount to the Agent Lender, acting on behalf of the
Lenders and the DOE, within ten days of receipt from the Agent Lender of a
written demand for payment, which demand for payment shall be mailed by the
Agent Lender to all Limited Partners immediately following any default by the
Partnership in the payment when due of any outstanding installments of
principal of the Loan. The undersigned further agrees and promises to pay any
additional amounts, if any, as are required to reimburse the Agent Lender and
the DOE for out-of-pocket expenses (including fees of counsel) reasonably
incurred by them to enforce the undersigned's obligations under this Agreement.
4. The undersigned's assumption obligations pursuant
to this Agreement shall extend only to $_____ of the principal due on the Loan
for each $5,000 of Interests purchased by the undersigned (together with the
enforcement expenses specified in paragraph 3 above) and shall not extend to
any portion of the interest payable by the Partnership on the Loan. While the
undersigned may be called upon from time to time to make partial payments to
the Agent Lender as and to the extent that there are uncured defaults by the
Partnership in the payment of installments of principal due on the Loan, once
the payments have aggregated the sum of $_____ multiplied by the number of
$_____ Interests purchased by the undersigned (plus any enforcement expenses
required to be paid by the undersigned as specified in paragraph 3 above), the
undersigned's obligations under this Agreement shall be deemed to have been
fully satisfied.
5. The undersigned's obligations shall be separate
from and independent of the obligation to make a capital contribution to the
Partnership in respect of his [her, its] Interests, as specified in the
Partnership Agreement. Any payments made by the undersigned pursuant to this
Agreement shall be treated as an addition to the undersigned's capital account
in the Partnership.
6. The undersigned's obligations shall not be
contingent upon or affected by the similar undertakings by other Limited
Partners evidenced by the Other Agreements. The undersigned agrees that the
Lenders and the United States Government may proceed to enforce this Agreement
without also proceeding to enforce any of the Other Agreements. The obligations
of the undersigned shall not be waived or discharged by the failure of the
Lenders or the United States Government to assert any claim or demand or to
enforce any right or remedy under any agreement or guaranty related to the Loan
Agreements.
7. The undersigned expressly waives (a) notice of
acceptance of any action taken or omitted in reliance and of any defaults in
the payment of the Loan, (b) any presentment for payment, demand, protest,
notice of nonpayment, notice of protest and notice of any other kind, and (c)
any requirement to proceed against the Partnership or any other Limited
Partners or any guarantor of any portion of the Loan or exercise any other
right or remedy against the Partnership or any other persons. The undersigned
irrevocably submits to the jurisdiction of the Circuit Court, County of
_________, State of _________, for the purposes of any suit, action or other
proceeding arising out of this Agreement.
8. The undersigned agrees that the Loan, the Loan
Agreements, the Guarantee and any other documents or agreements entered into in
connection with the Loan may be modified, amended and supplemented in any
manner including the renewal or extension of any portion of the Loan, without
the consent of the undersigned, and agrees that no modification, amendment,
supplement, renewal or extension shall release, affect or impair the liability
of the undersigned. However, notwithstanding any modification, amendment,
supplement, renewal or extension, the liability of the undersigned will in no
event exceed the sum of $_____ multiplied by the number of $_____ Interests
purchased by the undersigned (plus the undersigned's obligations to pay the
enforcement expenses specified in paragraph 3 above). The undersigned agrees
that no invalidity of the Loan, the Loan Agreement or any of the other
documents or agreements entered into in connection with the Loan shall affect
or impair the undersigned's liability under this Agreement. The undersigned
also agrees that neither the termination of the Partnership nor the transfer of
the undersigned's interest in the Partnership shall affect the undersigned's
liability under this Agreement, unless the Lenders and the United States
Government shall have executed and delivered to the undersigned a written
consent to the release, or assumption by another party, of the undersigned's
liability under this Agreement. The undersigned agrees that the Lenders may
assign their rights under this Agreement and the Other Agreements without
having to obtain the consent of the undersigned or any of the other Limited
Partners.
9. The undersigned acknowledges that he [she, it] has
no right of subrogation or contribution against the General Partner, any
stockholders of the General Partner, any of the Limited Partners or any other
person with respect to any payments which the undersigned may make pursuant to
this Agreement. So long as any sums remain owing by the Partnership to the
Lenders or the United States Government in respect of principal due on the Loan
or pursuant to the Guarantee, neither the General Partner nor any of its
assigns shall have any rights or claims under this Agreement. However, if all
sums owing by the Partnership to the Lenders or the United States Government in
respect of principal due on the Loan and pursuant to the Guarantee have been
paid in full, then the General Partner or its assigns will be subrogated to the
Lenders' and the United States Government's rights against the undersigned
under this Agreement to the extent of any payments previously made by the
General Partner or its assigns to the Lenders or the United States Government
in payment of principal due on the Loan or pursuant to the Guarantee.
10. The undersigned acknowledges that any and all
payments made by the undersigned pursuant to the first two sentences of
paragraph 3 above shall be applied first to the payment of outstanding
principal due on the Guaranteed Loan until all outstanding principal due on the
Guaranteed Loan shall have been paid in full. If, and only if, the outstanding
principal due on the Guaranteed Loan shall have been paid in full, any and all
payments made by the undersigned pursuant to the first two sentences of
paragraph 3 above shall be applied to the payment of outstanding principal due
on the Nonguaranteed Loan.
11. This Agreement and the undersigned's obligations
shall remain in effect until the Loan is repaid in full. It is acknowledged
that principal payments on the Loan by the Partnership (or the General Partner
or any other person) will not reduce the amount of the undersigned's
obligations under this Agreement until the outstanding principal amount of the
Loan (originally $_____) falls below $_____, at which point there will be a pro
rata reduction in the obligations under this Agreement and the Other Agreements
in proportion to reductions in the outstanding principal amount of the Loan.
12. This Agreement shall be governed by and construed
in accordance with the laws of the State of _________. The undersigned
designates the General Partner as the undersigned's agent for service to
receive notices to and demands upon the undersigned pursuant to this Agreement.
All notices to and demands upon the undersigned shall be made by certified or
registered mail addressed to the undersigned c/o _________ Corporation of
_________, _________ Street, _________, _________, or to any other address as
the Partnership may designate in writing to the Agent Lender and the DOE prior
to the mailing of the notice or demand.
Very
truly yours,
_______________
Signature
of Subscriber
Date: _________, 19__
Subscriber's Name and
Mailing Address:
_______________
(Name)
_______________
(Street)
_______________
(City) (State) (Zip Code)
Subscriber's Social Security
or Tax I.D. Number:
_______________
Agreed to and Accepted:
The _________ National Bank
of _________
By: _________
Title: _________
Date: _________, 19__